tv Bloomberg Markets Asia Bloomberg November 9, 2016 9:00pm-10:01pm EST
outlook for the yen and the trump effect on trade. it looks like we are at the same levels we were before this election took place. let's have a look at what is going on. the green theme is continuing, isn't it? what a difference 24 hours makes. the nikkei,with falling 5.4%. 5.7% in early trade today. the asx 200 having a massive turnaround. gain in fivegest years. this as we start to see markets in the fact that donald
trump could ramp up spending, good for inflation. you are seeing a turnaround coming through in equities, and bonds getting dumped. the overall picture differently yesterday, now seeing a lot of buying conviction coming through. mainly material players are driving the markets. australia, solid support from key mining players. gold stocks now being dumped. down by 6% to 8% in australia. kong, a rebound, only one stock in the red today. yesterday, all 50 were in the red. a lot of movement in energy players, crude oil holding above $45 a barrel, so a turnaround from wednesday session.
have a look at the bond market. 10 year have jumped by 20 basis points in australia, similar and new zealand, 2.46%. currency markets, quite a bit of of turnaround for the japanese yen. up by a third of 1% against the dollar. also, the chinese yuan. we have the fix coming through, the u.s. dollar jumping against the yuan. the october 28 high and the level we have not seen since 2010. a very different picture in equities and bonds than this time yesterday. , let's get over to pictures coming through.
these images coming through from philadelphia, hundreds of protesters protesting against the election of donald trump. that is broad street in philadelphia. a number of march is taking place across the u.s. hundreds of protesters protesting against him of as u.s. president. republicans say they have claimed a mandate for their agenda to revamp financial roles and replace obamacare. forker ryan credited trump helping republicans keep control of both houses. we are going to fix our inner cities and rebuild our highways, bridges, tunnels, airports, schools, hospitals.
we will rebuild our infrastructure. which will become, by the way, second tnone. his rival hillary clinton and barack obama urged everyone to get behind the new president. >> donald trump is going to be our president. we own him an open mind and a chance to lead. our constitutional democracy enshrines the peaceful transfer and we don't just respect that, we cherish it. i have instructed my team to follow the example that president bush's teams that eight years ago and work as hard as we can to make sure that this is a successful transition for the president-elect. we are now all rooting for his success in uniting and beating the country. this affect does
u.s.-china relations? we are having a look at this one. it is a big question. is, who is donald trump really? withuld you be dealing donald trump the candidate who said a lot of anti-china rhetoric, or will it be president donald trump, who needs to maybe tone it down, or maybe he doesn't? many more we have questions about the u.s.-china relationship going forward than we have answers. 45% tariffs on all chinese made goods into the nine states. the commonwealth of australia said that could cut exports to the united states by 25% in the first year alone. this is a $600 billion trade relationship heavily skewed in china's favor. how much more would
americans want to pay for their iphones and other goods they buy? >> that's another story. currency manipulation could be ,omething that president trump still getting used to that, president trump will possibly -- rishaad: president-elect trump for the time being. >> currency manipulation, he name china a currency manipulator on day one. what does that mean? it means they will start a series of steps to potentially penalize china. rishaad: you told me last time that the last person to call china that was bill clinton. >> 1994. it is a different economy now. china is aaying currency manipulator, the yuan
is weakening further as the dollar strengthens, but some could argue that china is manipulating it stronger. they could let it weaken a lot further. it's not necessarily weakening against other currencies. the geopolitical issues are really at the forefront. the state media and china has had a field day with this campaign. they are chortling behind closed doors and say look at the mess the night states political system is in. the state mouthpiece, this is what xi jinping. i highly value the relations and look forward to working together with you, obviously mr. trump, to expand u.s.-china cooperation in every field. at least china is taking a constructive approach, but you have to look at the future of
tpp. that is probably out the door. you have to look at climate change progress. at defense look treaties that the united states has would japan, south korea, taiwan, philippines, to a non-degree, but if trump makes those countries pay a bigger portion of their security thosets, does that push allies more towards china, does china become more nationalistic, more questions than answers. rishaad: thank you very much indeed. those allies moregoogle says it has ao reach out to the next billion internet users likely to rely on smart phones for computing needs. more from the president of asia pacific operations in singapore, google officially opening its headquarters today. it is quite an opening there, isn't it? we are absolutely delighted.
we are opening the office in a couple of hours this morning. isare delighted because asia becoming the center of the world and many aspects, center for decision-making, culture, and certainly with half of the world's population and the population increasingly mobile that the best use cases on smart phone devices are coming from we are seeing users all across the country, actually the most avid users, the at the philippines using photos more than anyone else per capita, malaysia using messaging more than anyone else in the world, or do vietnam, avid users of video. carrying will continue on, and we need to be in the center of this region with larger offices, more engineering presence to be able to capture
the essence of what users want to do in this region so we can serve them better. want to turn to politics briefly. i can't not possibly talking about donald trump being elected thereent of the because is this idea that he will engender protectionism, and with protectionism, we get trade constrained.nness does this worry you and you think it will come to pass in any way and how would it affect google? it is really interesting when you look at search over the last before thes election, you saw in the u.s. and many other countries around the world that the most search terms were around immigration , where asse of isis in asia, it is really focused around trade, so people in this region really want to know what this u.s. election means to them from a trade perspective, even
in countries like hong kong and south korea, which have had political events of their own, we have seen over the last day or so that searches have focused on trade. it is something critical to people at in this part of the what the newtical elected president will decide to do on this very topic. -- you: let's talk about want to get to the next billion users. how would you do that and where are you wi i it is very important to us that everyone around the world has the same access to information. you want everyone to be able to afford a smart phone, to be able to have the same access to information so they can educate themselves, so that they can start up businesses. or do the simple things that
many of us take for granted to, getting map directions or injuring many questions that our children may ask us. we have taken this seriously and have a number of projects to enable us to help populations get access to information. in india, we have launched a program where we are installing wi-fi in most of the train stations in india. thisve already done 73 year, and we are seeing that already 4.7 million people are accessing this network every day , and we are assessing that 15,000 of the internet. interestingly, we are seeing that because they are on this network, even though they are not for a long time, they are accessing 20 times the data. we are providing people with the ability to get information. rishaad: i am running out of
time. a couple of questions for you to do with indonesia, saying you know hundreds of millions of dollars in unpaid taxes. what is the latest on this and are you hopeful it get resolved soon? very quickly. we pay the right amount of taxes in each of the countries we operate and abide by the laws in which we operate and continue to engage with the government to thate that they see we do and abide by their laws. rishaad: my next question about south korea. you have this mapping controversy. and aree you with it you still talking with the government to resolve it? we engage with all governments around the world to ensure that they understand the benefits that our products provide to people, and mapping is an incredibly powerful product.
providing people with greater access to information, helping other companies that use the mapping services to make sure they can deliver their services to users. we have very open dialogues with governments about our products to not only improve the lives of people in their countries, but also improve businesses within their country and that a global level. ishink what you will see many more asian businesses will become global businesses thanks to some of the products we have, building on map products or even building on top of our cloud infrastructure. rishaad: great talking to you. pac, the opening of the asia-pacific headquarters in singapore. may facead, shinzo abe headwinds, but what is next for abenomics?
rishaad: the outcome of the u.s. presidential election is banning concerns about policies more hostile to global trade, and many observers inc. e tpp deal is essentially doomed. let's get more. -- and many observers think the tpp deal is essentially doomed. let's get more. how concerned are you about this? >> for us, it is business as usual. the u.s. market is very important to us, and not just the size, but the influence on world markets.
we are confident in the u.s.. trade between asia and the u.s. has been growing. the projections for next year is growth of 2% to 4%, so we are confident. there will not be any material change for a while anyway. jitteriness,l this the up-and-down, stocks, commodities, so it's too early to say anything. how would you characterize container shipping at the moment? still inan industry trouble because of the low profitability. that trade with the u.s., it is starting to look more healthy, but overall, the industry is not where it should be. is that suggesting perhaps the u.s. economy is getting back on its feet? >> it is both directions. there is also a lot of trade going back. rishaad: maybe it is a
bellwether for a recovery? economyinly the u.s. has been doing better than most others, so this is a good sign. industry is in trouble at the moment, and it seems like this happens on a regular basis. is the worst over with in your view? supplyertainly see the -demand gap is getting smaller, , soships are fewer particular trait with the u.s., we are seeing some balancing out. it is a hugely complex business you are in. in good times, too many ships are ordered. and bad times, too many ships are scrapped. what gives? >> it is a cyclical industry. you try to plan economic growth and container growth going ahead and then match demand.
you need to look pretty far ahead to order your tonnage. in our case, we are a large player with 15.5% of global afford largewe can ships that fit into our fleet pattern. rishaad: you own some of the biggest ships in the world, don't you? >> we do. so actually we are facing utilization and the upper 90's in terms of percentage. we are using our assets well. us, if youick with will. we will be talking more about the state of container shipping industry in light of the news out there, which has not been great for one korean shipbuilder, if you like. ♪
conversation with robbert van trooijen. we can't really not talk about shipping without talking about , parts of the business and bankruptcy crts right now. happened, it was said that this is a lehman type moment for the shipping industry. at the mergersk and acquisition activity, i would say there is a seismic shift. we are seeing a lot of consolidation, some of the unlikely competitors consolidating as well, so there is a movement. whether it is a layman movement or not, i don't want to speculate. brothers moment or not, i don't want to speculate. is said that he could be the first of others as well. >> we are very well-financed. rishaad: i know you would never reveal that. so there we go.
>> in terms of the leverage of a sourcetry, that is of concern, and the underlying profitability is a concern, so if you are heavily in debt and have low returns, that should be a concern. there are companies doing better than average and maersk line is one of them. there is a movement of customers who are worried about the profitability of our competitors. rishaad: this is it then, are there too many players? is that why margins are so thin? long said that consolidation would benefit the industry. it is still a fragmented industry. we are a leader with 15%, but there is still room. rely on you will not organic growth, are you? would you be interested in picking up hanjin assets? >> we are growing well and the
of markets, so we are gaining market share. secondly, if the right partner was out there and the right m&a potential is out there, we would consider it. we have picked up some ships after hanjin did not use them anymore, so we have a cups and tonnage, but not directly from hanjin. we picked it up from the owners. rishaad: where'd you go next with this? will you see this consolidation take place in this industry? you are suggesting it should be bigger. a seismic shift place in theking industry, and we would not be surprised if more is done, so i would say it's more than bits and pieces at the moment. you have had winds and
tailwinds, this must be a boost to your bottom line after saying $100 plus oil a couple of years ago. >> it has been a boost to the bottom line of our customers. we have passed along the savings to our customers, reducing the unit cost for our customers, supporting global trade as well. rishaad: what are you hedging at the moment? >> we are an oil and transportation business. rishaad: do you hedge at all? >> i am not aware that we hedge. , win is looking ahead the industry and you're out of the woods? >> i don't want to speculate. the growth of global trade and continuous efforts to save costs , those are the key elements of the recovery of the industry. you on theeat having program. please come back again. ceoert van trooijen, maersk join us in hong kong.
kong is 10:29 a.m. in hong , i am stephen engle with the first word headlines. after donald trump selection as u.s. president, republicans in congress have claimed a mandate. said speaker paul ryan donald trump help republicans keep control of both chambers of congress. anti-trunk protesters are on the street in several u.s. cities as his opponent expressed the results.
demonstrators marching through chicago, philadelphia, washington and other cities decrying the president selects new comments. people marched to the truck tower in midtown manhattan chanting, donald trump, go away. after speculation that a trump win would the federal reserve from raising interest rates, now speculation on how many times it will raise in 2017. trump's victory may create new headwinds for japan's economy with fluctuations in the yen and financial market. the currency is falling for the first time in five days. donald trump has vowed to scrap tpp, which was set to help japanese manufacturers.
global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. rishaad: indeed, this is "bloomberg markets: asia". i am rishaad salamat carried japan is closing out the morning, but quite a day. the,tte: quite a day in quite a 24 hours. we are seeing the nikkei go up by 5.7%, reversing the losses we saw during wednesday's session. to be risk on back across the asian equity markets. rebounding from the lowest we had seen asian markets at since june 24, the day asian reacted to the brexit vote. seeing a lot of movement
coming through in mining players. thatt to show a this chart shows you some of the key mining players in australia. they have really started to rally coming through. spike inee that big today's session as we see a comeback in copper, nickel, iron ore. the games you are seeing in the mining players really just joining in this global rebound following a selloff. back to the markets and having a look at bonds. you are seeing this risk on really mean that bonds are getting dumped and the yield on the 10 year note in australia and new zealand rising above 20 basis points. in fact, yields now for australian yields at their highest level since may. a return of 2.46% there.
the currency market in focus, and i want to show you the offshore renminbi. we had to fix come through from china today. the dollar has jumped .3%, above in october high and the level we have not seen since 2010. stronger,re renminbi 6.8107. quite a turnaround in terms of what we have seen in the equity space, the bond space, and the currency space. electiondonald trump's victory is giving china watchers new worries, the threat of a trade were between the world's two biggest economies to the president-elect has vowed to impose new tariffs of up to 45%. is this just hot air. that is what people trying to get to the bottom of. previously u.s. presidents
have criticized on trade only to do you turns. steve engles said bill clinton called china currency manipulator in 1994. president obama said he would do the same thing, but he never did label them. the current president-elect is trying to narrow the trade deficit with china, but he wants to put punitive tariffs on chinese imports possibly as high as 45%. would be a clear negative for chinese exporters and american exporters within china. economy, ahina's clear negative for china and the global economy and americans rishaad: tit for tat would be one of the worst things.
globalization and its critics are winning. >> the worry is we want to send into a trade war. it is unlikely that china would not respond. they could respond and take into growth, but that is quite unlikely. they could respond with a weakening of the yuan. fixing theday's weakness since 2010. what are they hoping to achieve? >> there is dollar strengthen that story as well. if they weaken their currency, that would create instability inside china and for the wider world economy as a source of deflation. one to gotrump does into a trade war with china, it could get ugly fast for china and the rest of the world. rishaad: speaking in parliament this morning, the finance minister has been highlighting
the importance of relations with the united states for japan's economy. government and its economic plans facing new headwinds, possibly from a trump presidency. about free trade as the basis for japan's success in the postwar era. >> exactly that. japan is of particular concern. prime minister shinzo plan for japan rests on the tpp going through. bloomberg intelligence said tpp could boost gdp by 2% by 2025, so if this is not go through, it could impact japan's economy in the medium to long term. donald trump said he wants to renegotiate existing u.s. trade deals. he has talked about getting rid of the tpp.
if it exists in some form, it will look different than how it does at the moment. the comments on u.s.-japan relations reinforce what shinzo abe said wn he welcomed donald trump. i would like to extend my heartfelt congratulations to candidate trump on his election as the next president of the united states of america. the japan-u.s. alliance is unwavering and tied with the bond of universal values. thepe to further strengthen bond of the japan-u.s. alliance withooperate closely president-elect trump to address the various challenges that the world confronts, and i look forward to working together with him. abe and donald trump spoke on the phone this morning. they did arrange to meet in new york next week, which is for aat unusual
president-elect. rishaad: what about the yen, abenomics, and all this? this could be one of the biggest issues for abenomics. republicans that are often seen as inflationary, taxcutting, so this could lead to high rates and a reprieve for the yen. volatility, the fed may hold off on hiking in december. bank of america merrill lynch saying the fed is more likely than not to postpone december, and goldmans think a hike is still on the cards, but 60% compared to 75%. the yen could pick up its trend.
again, more headaches. rishaad: just keeping this going at the moment. , ahave eisuke sakakibara former japanese finance minister, and were asking him whether this election has changed his views on movement in the currency. dollar-yen would probably move in the direction of depreciation. intentions are to depreciate the u.s. dollar and promote the message employment ofthat this low depreciation the dollar and slower appreciation of the yen will continue. this presidential election has not really changed substantially that trend in the currencies. rishaad: with that said, some
have said he will be somebody who spends, and with that spending may come inflation, fedh may mean the accelerated its path of normalizing monetary policy. would more rate hikes from the fed, how would that affect japan and the yen? this interest hike by the federal reserve had already been incorporated in the market rate inants so that the december would not really change the current trend of the abe said slow depreciation of the dollar, and slower appreciation of the yen will continue. what in your view represents fair value?
fair value for the japanese currency? well, it is very difficult to pinpoint the fair value, but i around 100 isen all right for the japanese , between 95-105, or between 100-110, that would be quite comfortable rates for the japanese government. rishaad: former japanese finance minister eisuke sakakibara speaking to was earlier. coming up, trump's stunning election sending stock markets on a roller coaster ride. we will hear from two former fund managers on how to navigate these alternate times. ♪ -- these volatile times. ♪
donald trump surprising election victory route of markets around the world. two fund up with managers and asked him if they are worried about investing during the trump presidency. resilient.omy is unemployment numbers are now under 5% in chicago and around the country. cranes going up, buildings are being built, people are shopping more, stores are full, so the momentum is so much we are not worried that a trump residency will have a downward impact on our economic recovery. >> marielle, how about you? agenda it most of the is obvious, infrastructure spending, roads, bridges, waterways, reestablish the
presence of the military, the notion of no adult left behind because of technology changes, energy, environment, student loans, handle the tax dynamics, handle regulatory reform, so a lot of this has been in the mix. there are no surprises. the only surprise is the outcome at 2:30 a.m. trump is promising big changes for the business community, lowering taxes, drastically lowering taxes, rolling back regulation for banking, for energy, and not to addresseasures climate change as much as the prior president. does that change at all your investment in your funds? >> from my point of view, it the notion of why i want to own a piece of america, meritocracy, rule of law, and
the free market system is being enforced. to allows capitalism flourish again, and hard-working people, small entrepreneurs, when now be praised if they are successful and not pitted against. >> we did not make any trades or changes in our portfolio today. the mentum in this economy is so strong, we fill great about the way we are position. this changes the course at all for the fed? my own reaction is the fed will raise rates in the next 30 days and they will do it no matter who won the presidency. >> how about you john? >> i would agree. over time as the economy strengthens, it will be natural rates to rise. its the normal course of things. as long as it stays within this
reasonable range we have now, multiples are not that high with interest rates around this range. isontinued to believe there a lot of value and upside in the market, even after this great recovery we have had. seem focused on what donald trump could do domestically, but what about internationally? what if the rhetoric becomes reality when it comes to trade policies in asia? he wants u.s. allies to pay their share. market,s force the particular he in asia, to take a pause, or does asia trade at a discount now? bei think things will different now that the election is over. we have a republican congress. we know that paul ryan and the leadership in the senate believe in having free trade, and i think they will be an important balancing act with president trump to make sure we don't do anything to destroy the positive
oure we have had with foreign partners throughout the united states and particular he throughout the world, in particular he in asia, so i am confident the leadership in congress will help keep us on track their, and i'm sure there will be appointments to key positions, but they were also do the right thing because the economy has been so strong and so clear about how having a good system for allowing free trade to happen it is good for our economy and great for the nation for the long run. right, quick check of the latest business flash headlines. current and former officials at some of south korea's biggest companies have been questioned as part of the investigation into the president. their are question over donations to a foundation. the president of coercing companies into donating.
shares in china's biggest property developer are gaining after it increased its stake in arrival. ke.raised its stake in van grand has built up its land bank in china and planning to inject acids into a property company listed on the mainland. a more direct leadership role as the ceo, the company saying it is not replacing ted chan. , melco's newerator management structure will allow for faster decision-making and allowed to become more competitive. hong kong planning to step up byorts to police misconduct ipo's sponsors, the regulators boosting supervision after complaints spiked in recent years. the watchdog may take action against a standard chartered
unit, a sponsor and ipo's some seven years ago. ubs could be fined and suspended from arranging first timeshare sales. is let's have a look at what going on. breaking headlines out of tata. it has nominated a new chairman of the company. one line on that. more details on that and a little while. coming up, the sales strategy being used to attract chinese consumers to this year's singles day. we are headed to shenzhen. this is bloomberg. ♪
rishaad: this is "bloomberg markets: asia". i am rishaad salamat. alibaba's day frenzy begins at midnight. in $13nt bringing billion in 2015, 4 times more than cyber monday in the u.s.. tom mackenzie is in shenzhen. how big is this year expected to be? yes, welcome to a windy shenzhen. this festival expected to grow exponentially again this year. analysts are saying 90% of china's online consumers will
take heart in the singles day festival. we seelysts say that if growth of 45% year on year, that will be robust. they are expecting strong growth, but more moderate in the big surge in growth we saw last year. aroundar saw sales of $13.5 billion. the shopping festival is expected to eclipse black friday by three or four times. it is of course a crucial event for international brands as well to build up their image with chinese consumers here, as well as giving big discounts, brands will be trying to push their image and grow their footprint in china. is whole festival as well that that missed test of the crucial chinese consumer, who are shouldering the burden at a greater level of the chinese economy, so it is a test of their resilience, but analysts
do expect a big pickup this year. may also seean stronger sales as consumers focus on the domestic market rather than trips abroad and macy's andike nike are expected to play a big role. says they expect chinese online consumers to grow 25% year on year, hitting 61 million consumers online by 2020, so it is a huge market of course. how are absolutely, things evolving here, how is alibaba changing things this year, and what has it been for the competition? alibaba are putting a big focus on social engagement this year. they want their consumers to spend more time online talking to each other, sharing their purchases, discussing the deals they are getting with friends and family online, and hopefully
moving them on to bigger ticket items. alibaba are also introducing virtual reality, macy's allows you to use your smart phone in a cardboard box to look around and macy's store in new york times square, for ample. games as well, so people will be able to play games online. it is all about keeping the consumers therefore as long as possible. we know chinese buyers have been putting away and storing in the baskets products they want to , lotsp, skincare products of demand expected for those, digital products, technology goods, and packaged foods. in terms of the competition, the likes of amazon china may feel the pressure of the next 24 hours as all the oxygen is sucked out of this by alibaba, and then you have jd.com, they a partnership with
walmart for groceries, so they're expecting him to help as well, but the focus will really be on alibaba and the shopping festival. analysts saying brands that don't get involved could see ofual sales lose a 10th april sales of the don't get involved in the shopping festival, so those are the stakes at play here. rishaad: thank you for that. tom mackenzie in shenzhen. i look at what is coming up. were looking at the asian rebound. were looking at the longer-term risks and opportunities when it comes to a trump presidency, up next on "bloomberg markets: asia". ♪